Ed Balls now agrees with me: there are big problems with the pretence of Central Bank independence
He’ll go a long way to try and find someone who agrees with him.
It’s also bollocks of course:
During the brief moment when I was, supposedly, the author of Corbynomics, I argued this case quite strongly and got some prominence for doing so. At the time the likes of Yvette Cooper argued that I would be sending the UK towards a Zimbabwean future for saying so.
I won’t ask for an apology because I know none will be forthcoming but knowing both my political and economic arguments have now been justified does give rise to a certain degree of satisfaction, I admit.
Ritchie argued that politicians should be able to tell central banks what to do and how. Ed Balls is arguing:
There are elements of the pre-crisis consensus that must be protected. We show that operational independence of central banks – the ability to choose an instrument to achieve inflation goals – has been associated with significant improvements in price stability. But, in advanced economies at least, political independence – the absence of any possibility for politicians to influence central bank goals or personnel – is not correlated with inflationary outcomes. In order to protect their popular legitimacy, central banks in advanced economies can therefore sacrifice some political independence without undermining the operational independence that is important in both their monetary policy and financial stability functions.
Balls isn’t agreeing with Ritchie at all that is.